HMRC plan to raid our bank accounts slammed by MPs

PLANS to let the taxman take cash out of people’s bank accounts without their permission were condemned by MPs last night.

The idea of giving HMRC access to our bank accounts was in George Osborne's recent Budget plans [GETTY]

They said HM Revenue and Customs had a track record of blunders but customers wrongly accused of owing tax would be powerless to prevent their money being seized.

HMRC wants the power to seize money from any account including ISAs and joint bank accounts even if one partner owes nothing.

In a scathing report, the Treasury Select Committee said the proposal caused them “considerable concern” and accused the Government of trying to rush the change through.

The idea of giving the taxman access to millions of accounts to collect unpaid tax and overpaid tax credits was unveiled by ­Chancellor George Osborne in his Budget in March.

The proposal to grant the power to HMRC to take money directly from people’s bank accounts is very concerning

Andrew Tyrie

He wants to make it law next year. But the MPs’ report said the change could inflict "serious detriment" on individuals and called for more safeguards.

The committee's Tory chairman Andrew Tyrie said: "The proposal to grant the power to HMRC to take money directly from people’s bank accounts is very concerning.

“People should pay the right amount of tax but HMRC does not always ask for the right amount.

“Some taxpayers may find money taken from their accounts that later should be paid back. That would be unacceptable. Exceptional powers such as this require prior ­independent oversight. The Government must demonstrate that it has dealt with the committee’s concerns before proceeding.”

With this system, HMRC could wrongfully take money from taxpayers without permission [GETTY/MODELS USED]

HMRC already has the power to seize physical assets but it needs a court order before it can take cash directly from accounts. It says this can be slow and expensive, giving the debtor time to move or spend the money to avoid seizure.

Mr Osborne says the move is designed to target people “who can afford to pay but have repeatedly refused to do so”. They must owe more than £1,000, have been ­contacted at least four times by HMRC and exhausted all appeals.

It will affect about 17,000 people a year and bring in up to £120million.

Among proposed safeguards are leaving people a minimum of £5,000 to meet day-to-day needs.

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But experts who gave evidence to the committee complained that HMRC would be “acting as judge and jury”. Concerns were also raised about its ability to assess who had the means to pay, including people on low incomes with multiple debts to different organisations.

One professional body told the MPs there were numerous recent cases of HMRC chasing debt that was not due. The MPs noted: “HMRC has, in the past, committed errors on a much larger scale.”

These include losing two child benefit computer discs in 2007 with the name, address, date of birth, National Insurance number and bank details of 25 million people.

Andy Silvester, of the TaxPayers’ Alliance, said: “Giving HMRC the power to dip directly into people’s pockets could be a recipe for disaster for law-abiding taxpayers.”

A Treasury spokesman said: “The proposed powers will give HMRC another tool to collect tax debt owed. The current consultation includes a range of safeguards.”